Speak with a Registered Agent: 1-866-223-2121

Speak with a Registered Agent: 1-866-223-2121

Indexed Annuities Market Growing and Changing


Indexed annuities have been growing at a much faster rate than variable annuities and fixed annuities in the past 5-10 years.  The Life Health Pro article, “New players enter indexed annuity space” by Maria Wood, says that the compound annual growth rate for indexed annuities was 9.3% from 2005-2010.  Variable annuities grew 1.9% and fixed annuities grew 2% in the same time frame.  These statistics were taken from Conning Research & Consulting’s indexed annuity study.  Indexed annuities are likely to continue their growth pattern because of great opportunities, but they also have to face some challenges coming their way.

A new trend looks to be occurring that signifies a return of the “captive agent,” as opposed to using more distribution networks.  Allianz Life is the first company signaling that return with their fixed equity indexed annuity product.  Their “virtually tied agents” have to submit to a suitability review from Allianz.  While this strategy is working for Allianz so far, the use of virtually tied agents and distributor-designed products does hinder competition.  These are some of the challenges to which indexed annuity providers seek solutions.

Big names in the variable annuity market have started entering the indexed annuity territory and that trend is likely to continue.  The entrance of Hartford and Genworth offers a bit of a threat to those currently selling indexed annuities.  Some advantages variable annuity providers bring include distribution networks that have already been established and experience with hedging for living benefits and index linking returns.  Rule 151A’s elimination made it easier for these variable annuity players to enter the indexed annuity market.

Written by Rachel Summit

Follow Finance Mama on Twitter https://twitter.com/#!/financemama

For more information about the product mentioned in this article contact us here:

Information Request Form

If you have questions or would like more information, please complete this form and a licensed professional will be happy to help. For the fastest response, please select 'Phone' as your Contact Preference.

By providing your information and clicking 'Submit' above, you acknowledge that you have read and agree to this site's privacy policy. You also provide your consent to be contacted at the email address or phone number provided above (including any wireless number) by licensed agents or representatives from or on behalf of AFYI Holdings Group, LLC and other companies to provide the information requested and/or offer annuities or financial products. You understand that these calls or SMS messages may be generated using an automated telephone dialing system, a pre-recorded message, or artificial voice. Consent to receive such messages is not a condition to purchase any goods or services. You may opt out at any time by following the instructions in the messages you receive.  Receiving quotes and information through our website is free, and you are under no obligation to purchase any goods or services as a result of this request. You affirm that you are the subscriber of the provided telephone number or that the subscriber authorized you to provide the number. Message and data rates may apply. AFYI Holdings Group, LLC is committed to respecting your privacy and adhering to all applicable laws and regulations, including the Telephone Consumer Protection Act (TCPA).